We appreciate the great response to last month’s issue of Internet ScamBusters. You can check out the most interesting tips, stories, and feedback we received – and learn from other subscribers’ experiences – by visiting ourTelephone Fraud page.

Quite a few subscribers asked us one specific question about reducing credit card fraud (Issue #23). The question is:

How do you verify addresses to help reduce credit card fraud?

Answer:

For purchases using Discover and AMEX, call these phone numbers to verify the name and addresses:

AMEX – 800-528-2121 (Be sure to say you want address verification.) In those cases when AMEX international cards can’t be verified using this phone number, the AMEX operators will suggest you call 800-544-1019 for verification.

Discover – 800-347-7988 (Tell the operator: “This is [your name] at [your business name]. I need an address verification.” Have your merchant number available.)

Verifying addresses for purchases using Visa and MasterCard is a bit more round about. Call 800-228-1122. Once you’re connected, press 2 for address verification. Then, you’ll be asked your merchant number, the customer’s credit card number, expiration date, and the *numbers* in the address and the zip code. These numbers will be entered into their computer and you’ll be told whether or not they match the key in the computer. If it matches, Visa/MasterCard says you can go ahead and process the order. If it doesn’t match, they will give you the name and phone number of the bank that issued the customer’s credit card, and you can call that bank for more complete address verification.

(Note: we appreciate Dave Sparks, Interact! CD-ROM Store at http://www.interactcd.com for contributing some of the information to this answer.)

On to this month’s topic…

The 12 Scams Most Likely To
Arrive Via Bulk Email

As all long-time subscribers of Internet ScamBusters know, we are very strongly opposed to using bulk email (“spam”) for any reason whatsoever. We’ve also warned subscribers not to buy or take action on any bulk email offer. For information on why, see Internet ScamBusters issues:

The US Federal Trade Commission (FTC) is offering the same advice. The FTC had asked people to forward bulk email to the agency so they could take an inside look at the kind of offers that arrive via bulk email.

“FTC staff found that more often than not, bulk email offers appeared to be fraudulent, and if pursued, could have ripped off unsuspecting consumers to the tune of billions of dollars.”

Last month, the FTC identified its “Dirty Dozen,” the twelve scams most likely to arrive via bulk email in consumers’ email boxes.

Here is the “dirty dozen” and a brief explanation of why each is a scam:

1. Business opportunities scams: These offers make it sound like it is very easy to start a business that will earn piles of money without much work, selling or cash. Many of these “opportunities” are actually illegal pyramid schemes that are masquerading as legitimate opportunities to earn money.

2. Make money by sending bulk email. These solicitations offer to sell you bulk email lists (consisting of millions of email addresses), spam software (usually very poor in quality), or services to send spam on your behalf. Don’t do this.

3. Chain letters. No list of scams would be complete without this old “favorite” – email style. Here you’re asked to send a small amount of money (or some item) to each of four or five names at the top of the list, and then forward the message including your name at the bottom, via bulk email. Many of these letters claim they are legal – they are not. Further, nearly everyone who participates in these chain letters loses money. Even if there is a “product” such as a report on how to make money, it does not make these schemes legal.

4. Work-at-home-schemes. The most common work-at-home scam promises that you’ll earn money for stuffing envelopes. For example, you’re promised you’ll earn $2.00 for every envelope you stuff. In fact, there never is any real envelope stuffing employment available. Instead, you pay to register and then you’re instructed to send the same envelope-stuffing ad via bulk email to others. The only money you can earn would come from others who fall for the scam and pay to register. Finally, if you did actually do work for one of these outfits (for example, some promise to pay you for craft work), they’d refuse to pay you and say your work didn’t measure up to their “quality standards.”

5. Health and diet scams. These are similar to the miracle cures offered off-line: ways to lose weight without eating less or exercising, “scientific breakthroughs,” “secret formulas” which provide cures for hair loss, and herbal formulas that liquify fat cells so that they are absorbed by your body. These scams often include testimonials from “famous” medical experts you haven’t heard of. Of course, these gimmicks don’t work.

6. Effortless income. The newest version offers get-rich-quick schemes to make unlimited profits exchanging money on the world currency markets. There are lots of variants, but they all promise vast riches with no work. Beware of these scams.

7. Free goods. These offers promise expensive items such as computers… for free. They ask you to pay a fee to join, and then you have to bring in a certain number of other members. Many of these scams are just disguised pyramid schemes.

8. Investment opportunities. These scams promise outrageously high returns… and of course, there is “no risk.” Many of these scams are illegal Ponzi schemes, in which early investors are paid with the money from later investors. This gives the early investors the illusion that the system works and they are then encouraged to invest more money (which they eventually lose). The sales pitches for these offers include claims of high-level financial connections, that the promoters are privy to inside information, or promises that they’ll guarantee the investment. The promoters are long gone if you try to take advantage of their “guarantees.”

9. Cable descrambler kits. These scams offer kits or information on how to receive cable transmissions without paying any subscription fees. There are two problems with these offers: 1) the kits and information don’t work; and 2) even if they did work, it is illegal to steal service from cable television companies. Further, many cable companies have aggressively been prosecuting cable service theft.

10. Guaranteed loans or credit, or easy terms scams. There are lots of variants of this scam: home equity loans that don’t require any equity in your home, loans regardless of your credit history, offshore bank loans, credit cards regardless of your credit history, etc. Sometimes these offers are combined with pyramid schemes that offer to pay you for attracting other participants to the scheme. However, they are scams – the loans don’t come through, you are turned down unless you meet stringent requirements, or the credit cards simply don’t arrive.

11. Credit repair scams. These scams promise to erase accurate negative information from your credit file so that you can now qualify for loans, mortgages, or credit cards. The promoters of these scams cannot deliver. Further, if you follow their advice and lie on a loan or credit application,
misrepresent your Social Security number, or get an Employer Identification number from the Internal Revenue Service under false pretenses, you will be committing fraud and violating federal laws. Don’t fall for this scam.

12. Vacation prize promotions. Last, but not least, is a scam in which you receive electronic verification congratulating you because you’ve “won” a fabulous vacation, or you’ve been “specially selected” for this opportunity. The “deluxe cruise ship” may well be more like a tugboat, upgrades can be very expensive, and hotel accommodations are likely to be very shabby.

More about the FTC’s Dirty Dozen can be found at:
http://www.ftc.gov/bcp/conline/pubs/alerts/doznalrt.htm

The punch line (which you’ve heard from us many times before): If it sounds too good to be true, it probably is. Further, don’t buy anything via bulk email (spam). Your chances of being scammed are astronomical. And follow the advice from other past issues of Internet ScamBusters when buying items… both on and off the Net.

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